One of the things that can be guaranteed in this lovely world of ours is that the same questions keep coming-up time and time again. Sure, they may be asked by different people, at different times, but they still come-up. Over the years, I have had many people ask me 'Craig, what are the biggest mistakes you see with home businesses'? Having become tired of answering the same old questions, I've decided to detail the 5 biggest mistakes I've seen made by home businesses (in no particular order). 1. No Clear Plan of What is to be Achieved In this day and age of ecommerce, an unfortunate consequence of the ease with which these type of transactions can be conducted is that novice business owners believe they can establish their business, make a mint within a year, then retire or move onto the next project. Whether your business is internet-based or a more traditional 'bricks & mortar' business, you still need to plan what you want to get out of the business. This by no means preparing a 10 page business plan, however, you should still set your goals so you can identify your progress towards achieving those goals. The more identifiable your goals, the more focused a person is towards achieving those goals. 2. Lack of Commitment When the first million isn't made within the first year, most people give-up. Remember, success takes times! If it were easy, you would all be millionaires. Set goals for the first year, the second, the third and so on. If you achieve your first year's goals, there is momentum to achieve the next year's goals. Don't make your goals unrealistic either. Think about what you can achieve and go from there. Despite what people may think, most overnight successes have taken years to achieve. 3. Not keeping an Eye on the Finances Cash flows! Budgets! Projections! Boring, I know but so critical. Big businesses do these and there is no reason why home based businesses should not either. Some of the best home based businesses I have seen have adhered strictly to the preparation of these documents and continually monitored progress against them. Do you know that your bank account will show a significant dip in 8 months time? How are you going to finance your new stock intake? Will the bank sign-off on that new car you wanted to lease even though this month's turnover and profit were down? These are all questions that can be answered by having the right financial documents prepared. These documents also highlight when significant government obligations (such as tax) which, in my experience, most business owners forget about (or try to forget about). 4. Failing to Network Even with an internet-based business, it is essential to maintain a contact network. These could include monthly chamber of commerce meetings, supplier meetings and indeed, even informal discussions with competitors. There is a wealth of information to be obtained from having an informal drink or lunch with any of the above and for also keeping a tab on what people critical to your business think about the future. 5. Failing to Service the Client/Customer A number of home based businesses I have seen think the job is finished when the order is sent or the money in the bank. Here's a little secret that successful business owners have known for some time now. The job is never finished. This is because you must always market your products and services to your clients and customers. You must always be aware of the sentiment of those people (Is the tide turning? Do they want something different? Can I offer it?). Successful business owners never rest on their laurels, they are constantly looking to improve and this is the drive that keeps them at the top of the pack. All comments above are of a general nature only and are not intended to be construed as specific advice. Always seek professional advice for your own personal circumstances. |
